Hi all, I'm a complete newbie starting out in trading, interested in forex especially. I've deposited $10,000 in an online brokerage account. Planning to start out as small and conservatively as possible when I feel comfortable. I am realistic, I am not expecting to be profitable for at least a couple years (if that), so I hope that the price of tuition for the time isn't too expensive. Some background: Grad student in quant field with a few years of online/live mid stakes poker experience. 1) What do you think of the relationship between my starting account, bet sizing, and experience? 2) What are normal things to expect in the first six months? AKA: What should I be most afraid of that will cause me to blow out the account? 3) What are good threads on ET for someone like me? Thanks in advance for any advice from anyone.
Decided to take out $5k since $10k seems a bit much for a noob like me to play around with. Anyways, started the first session and totally disappointed with myself, I'm a clown. Went on total tilt. I had 1, 2, 5, 10, 15, 20, and at a few times 30 (mini-)lots of EUR/USD 10,000 lots. 30 lots!!! What an idiot I am. Basically chasing after losses. I think I committed every error possible. - Went from 5k to 4.3k betting up to 10 lots. - Got lucky and caught a swing up to 5.1k...now using up to 30 lots. - Said to myself I would play it cool. Nope. 1 lot, 2 lots, 20 lots, then 30 lots. Dipped down to $3.8k, then caught a lucky swing back up to $5,171, at which point I exited and felt shitty about my first trading performance. So made a 3.42% gain...through sheer luck, lack of emotional control, and a lot of stupidity. Hopefully I get better. Emotional control and trading discipline to do the very simple things seem to be more pressing concerns for me, before I get into the nuances of technicals and fundamentals.
Doing what you're doing is probably a good way! Overleveraged, poor money and risk management, no discipline......you might be better getting a plan together on a demo account before wasting real cash. Or give your 5k to me, at least I'll say 'thanks' which is more than your broker will do
My advice would be withdraw your $5k and play with your $171. Or at least lower the stakes so it's still real money but not enough to get too emotional. Then when you can handle that and stick to your system or methods then gradually increase the stakes..
Agree with you all, though I'm going to keep the cash in the account. Paper trading seems to take about 75% of the game away. Even if I make correct decisions there, no guarantee I will make the correct decision with real money. Anyways, I hope my account survives the first few steps. My plan for my next session is to limit my position to 2 mini-lots of EUR/USD, with stops at 50 pips away.
I started 6 months ago and I'm still paper trading. I'm gunna be starting my masters in quant next year but what I paper trade with now has very little to do with quant. I use price action stuff that I learn't mostly at http://www.learntotradethemarket.com combined with money mangement (financial modelling can help here, but unnecessary) I have been paper trading profitably - works better than the quant strategy that I made up , though I was very inexperienced when I first started in quant.
Couldn't sleep...so I went to trade some more. The plan was to maintain a small position, leverage up when on a trend, and leverage down when it moves against me, placing stop losses to protect me. Account is now up to $5974 for a 19.48% gain on starting capital for my first day. I am going to go by the following strategy: use small positions as "probes." Once a huge trend is coming, continue to leverage up more and more, with appropriate stops that automatically deleverage me if the position turns against me. This only works for the BIG trends. I figure that I might as well use my gambling mentality to my advantage when I have a big trend, while maintaining a very small position when I'm "probing" so that I don't get on tilt too easily. For all you veterans: please give me some directed criticism if you have time. Thanks in advance.
#1. Do not trade over 1 contract at a time. #2. You WILL OVER TRADE...It happens to everyone in FOREX. Once you take a loss...sit back and look at it as a lesson learned. Do NOT CHASE a losing trade. Go WITH the TREND in Forex. Try a method called the MOUTEKI method. It is based on a 4 hr breakout. It will give you a couple good trades a month. I have some documents on how to set it up if you need it.